Rise of the million-dollar home

01:36, Sep 22 2013
St Mary's
PRICEY PROPERTY: St Mary’s Bay was the most expensive place to buy a home, with a median price of $1.45m.

The number of million-dollar suburbs has increased sixfold this winter compared to last, according to the latest REINZ/Fairfax Media Housing Market Report.

Winter is traditionally the quietest time of year for residential real estate but the market remained so strong this year that price gains now appear to be bedded in, particularly in Auckland.

Last winter there were just two suburbs where the median selling price was above $1 million; this year 13 suburbs made it on to that list, all of them in Auckland.

The full national suburb-by-suburb breakdown can be viewed at the bottom of this story.

St Mary's Bay was the most expensive place to buy a home, with a median price of $1.45m. That was up 177 per cent on last year.

However, the REINZ said that was because there was a large number of less expensive apartments sold during the same period last year, which skewed the figures.

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This year's median is probably more representative of prices in the elite suburb.

Other suburbs in the million dollar-plus club were Herne Bay, Orakei, Remuera, Westmere, Epsom, Campbells and Castor Bays on the North Shore, Mellons Bay in the eastern suburbs and Mt Eden, Glendowie, Ponsonby and Grey Lynn.

However, substantial price rises have not been confined to the top end of the market.

Last year there were five suburbs in Auckland where the median price was under $300,000. That has now come down to just two as median prices in Otara and Manurewa pushed past the threshold.

The parts of Auckland where the median price was below $300,000 this winter were Wellsford, on the city's northern limit, Clendon Park, in Manukau, and the CBD, which is dominated by the shoebox apartment market.

However, the CBD also posted strong gains, with this winter's median price of $255,000 up 21 per cent on last winter.

Some of the biggest price gains were in the west of the city, with median prices in traditionally cheaper suburbs like Glen Eden, Glendene, Ranui and Kelston all posting increases of more than 20 per cent compared with last year.

In Wellington, the most expensive suburb was Kelburn, with a median price of $705,000, followed by Thorndon ($723,000) and Wadestown ($684,000). There were so few sales in Roseneath, which is also regarded as one of Wellington's most expensive suburbs, that it was not possible to produce a reliable median.

There were six suburbs in the greater Wellington region where median prices were under $300,000: Otaki, which was the cheapest at $235,000, followed by Wainuiomata, Naenae, Totara Park, Stokes Valley and Trentham.

In Christchurch, Fendalton, traditionally the city's most expensive suburb, retained its crown with a median price of $800,000, followed by Sumner at $712,500 and Northwood at $605,000.

The cheapest suburbs were Wainoni at $205,000, Aranui at $235,000 and Phillipstown $225,000.

Throughout the country there were four places where the median selling price was under $100,000.

The North Island towns of Taumarunui, near Taupo, and Wairoa, between Napier and Gisborne, shared the distinction of having the cheapest properties in the country with medians of just $60,000. They were followed by Kawerau at $72,500 and the Whanganui suburb of Castlecliff at $95,000.

REINZ chief executive Helen O'Sullivan said early signs were that there would be a good supply of listings coming on to the market during the spring; however that was not expected to ease price pressures, particularly in Auckland.

There seemed to be a sense of urgency among many buyers, driven over the past few weeks by people with low deposits trying to get deals done before the new loan to valuation restrictions kicked in, and others eager to complete deals before interest rates started rising, as they are expected to next year.

But people needed to remain rational about their purchase decisions, O'Sullivan said.

"Paying an extra $20,000 or $30,000 to save an extra 0.25 per cent on your interest rate doesn't stack up," she warned. "And interest rates will go up and you don't want to end up with an unmanageable loan."

See more Christchurch housing data here.

Sunday Star Times